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Complete Guide for Foreigners: Important Things Before Buying or Renting a Property in Malaysia

This complete guide provides information on important issues to be considered by a foreigner before buying or renting a property in Malaysia. It covers everything from conducting due diligence to verify property, as well as information on seeking legal assistance to review all transaction documents. Last updated in June 2023.

  • What do I need to do before buying or renting a property in Malaysia?

    You are advised to engage an independent legal representative to conduct a due diligence to verify or discover the legal ownership, conditions, restrictions or encumbrances of the property. A part from due diligence, it is also important to appoint an independent legal representative to ensure that the terms and conditions contained in the booking form are legal, reasonable, fair and in line with common trade practice.

  • What is due diligence on property?

    Property due diligence is the process of thoroughly reviewing and verifying all relevant information about a property before booking. This includes conducting official land search, checking with property management, confirmation on the identity of the legal owner, and identifying conditions, restrictions and encumbrances of the property.

  • What are the benefits of conducting land due diligence before signing a booking form for buying or renting property in Malaysia?

    Conducting land due diligence can help protect your interests by identifying potential risks or liabilities, ensuring that the property is legally available. Common issues that can be identified during land due diligence include identity of owner, conditions, restrictions and encumbrances of the property. A due diligence can help you make an informed decision about whether or not to buy or rent the property, and can help prevent fraud, disputes or problems.

  • Why is it important to appoint a law firm to conduct land due diligence?

    The law firm acts as an independent party to check and balance on the information provided by real estate agent. A law firm has the expertise and resources to thoroughly review all relevant information and identify any potential issues that may impact your agreement. This can help you avoid unexpected fraud, problems or disputes on the ownership dispute which may nullify the agreement and ensure that you are entering into a fair and legal agreement.

  • Why is it important to appoint a law firm to review and amend tenancy or purchase booking form?

    Having legal representative to vet and amend the terms and conditions of booking form can ensure that the provisions in the booking form are fair, legal, and in line with common practice. The firm can also help you to identify any potential risks or liabilities that may impact your tenancy or purchase.

  • How does legal due diligence provide a check and balance on the real estate agent?

    Real estate agents are primarily concerned with closing the sale and may not have the expertise to thoroughly review the legal documents related to the property. By using a lawyer to conduct the legal due diligence, you can have an independent assessment of the legal aspects of the property, and cross check the documents of the land with authorities or other official channels.

  • What are the benefits of having a check and balance system on the real estate agent when conducting legal due diligence on the land?

    A check and balance system on the real estate agent provides an added level of protection and assurance during the property purchasing process. It helps to ensure that the information provided by the real estate agent is accurate and unbiased, and that the property is free from any legal or financial liabilities. This check and balance system also helps to reduce the risk of fraud or loss in the transaction.

  • Can I still rent or purchase the property if issues are identified during land due diligence?

    Yes, you can still rent or purchase the property if issues are identified and are being properly tackled. A law firm can advise you on your options and help you negotiate any necessary changes to the agreement to better protect your rights and safely manoeuvring the issues.

  • What is the cost of conducting due diligence on a tenancy?

    The fees for a typical due diligence carried out by our firm is USD200.00 per due diligence report. The report includes: (a) official land search (property with separate title) or legal confirmation with property management office on the details (property without separate title); (b) legal confirmation on the identity of the legal owner; (c) official solvency report of the owner; and (d) legal confirmation on the conditions, restrictions and encumbrances of the title.  Read more on our service here.

  • What is the cost of review and amendment on the terms in the booking form?

    The fees is USD250.00 for review and amendment of the terms contained in booking form or offer to rent to ensure conformity to common tenancy practice by all parties. Contact us for more information.

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